Gold up for the day but limited by $1350

  • Gold higher despite risk appetite and US data. 
  • A weaker US dollar supports the yellow metal. 

Gold peaked after the beginning of the US session at $1,350.50/oz. It failed to follow through and pulled back. As of writing, was trading at $1,346 up modestly from Friday’s close. 

The metal was rising despite the improvement in risk appetite. The air strike in Syria by US, British and French forces was done in a way that minimized the potential for an escalation in tensions with Russia. The impact in global markets at the beginning of the week was limited. 

The key driver on Monday appears to be USD weakness. US Dollar Index Futures dropped from 89.45 to 89.03, level located marginally above last week lows. The greenback also pulled back against commodity and emerging market currencies. Better-than-expected US data did not offer support to the US dollar.  Retail sales rose in March 0.6% above the gain of 0.4% analysts predicted. 

Gold Technical Levels 

To chart shows gold moving above an uptrend line with support at $1,320. But the upside continues to be limited by near $1,350. The metal needs a daily close well above $1,350 in order to clear the way to more gains. While below, it is likely to remain limited and expose to corrections. 

From the current level, the immediate support might lie at $1,340, followed by $1,332 and the mentioned $1,320 (uptrend line Nov-Apr move). Below the last one, an acceleration to the downside seems likely. 

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